Law Firm Chart of Accounts Template

A starting point, not a finished chart. Adapt it to your practice areas, entity structure and reporting needs — then apply it consistently, which matters more than getting every name perfect.

Assets

Account	Type	Notes
Operating Bank	Bank	Day-to-day firm account
Savings / Reserve	Bank	Tax and reserve holdings
IOLTA — [Bank name]	Bank	One per trust account. Name it explicitly.
Accounts Receivable	A/R	Invoiced and unpaid
Advanced Client Costs	Other Current Asset	Costs fronted for clients. Not an expense.
Prepaid Expenses	Other Current Asset	Insurance, subscriptions paid ahead
Fixed Assets	Fixed Asset	Furniture, equipment
Accumulated Depreciation	Fixed Asset	Contra account

Liabilities

Account	Type	Notes
Accounts Payable	A/P	Owed to vendors
Client Trust Liability	Other Current Liability	Mirrors the IOLTA balance exactly
Unearned Fees	Other Current Liability	Flat fees collected, not yet earned
Credit Cards	Credit Card	One per card
Payroll Liabilities	Other Current Liability	Withholdings and employer taxes
Line of Credit	Long Term Liability

Income

Account	Notes
Fee Income — [Practice Area]	One per practice area, or use classes
Contingency Fee Income	Recognised on settlement
Flat Fee Income	Recognised as earned, from Unearned Fees
Reimbursed Client Costs	Recovery against Advanced Client Costs
Interest Income	Firm accounts only, never IOLTA interest

Expenses

Compensation — Attorney salaries · Staff salaries · Payroll taxes · Benefits · Retirement contributions

Professional — Malpractice insurance · Bar dues and licensing · CLE · Accounting and legal fees

Practice — Legal research · Practice management software · Court and filing fees (firm-borne only) · Expert consultation (firm-borne only)

Facilities — Rent · Utilities · Business insurance · Repairs

Administrative — Office supplies · Telephone and internet · Postage and delivery · Bank and merchant fees

Business development — Marketing · Website · Networking and referrals · Client entertainment

The five that do the work

Most of this chart is ordinary. Five accounts are what make it a law firm chart, and omitting any of them causes a specific, predictable failure.

Client Trust Liability. Without it, trust deposits have nowhere to live but income, and your firm looks far more profitable than it is.

Advanced Client Costs. Without it, money you fronted becomes an expense, disappears from view, and never gets billed back.

Reimbursed Client Costs. Without a separate income account, cost recoveries inflate your fee income and distort every margin calculation.

Unearned Fees. Without it, a flat fee collected in January becomes January revenue even though the work runs to June — and if the matter resolves early and a refund is due, the money is gone.

Fee Income by practice area. Without it, you cannot tell which work is paying for the rest, and retrofitting it across a year of transactions is a manual reclassification exercise.

Two rules that keep it clean

One: firm-borne versus client-advanced is decided at entry. A filing fee you will bill back is an Advanced Client Cost. A filing fee you are absorbing is an expense. Deciding this at the point of entry takes two seconds; deciding it at year-end takes hours and is frequently guesswork.

Two: never let the chart grow by accident. Every new account should be deliberate. A chart with three similar-sounding expense accounts guarantees inconsistent coding, and inconsistent coding makes year-over-year comparison meaningless.